Escolar Documentos
Profissional Documentos
Cultura Documentos
FURNITURE INDUSTRY
FORGING FORWARD TO FLOURISH
2 of 40
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Flourishing Furniture
On July 26, the Central Bank revealed the e-commerce furniture startup scenario has also
Monetary Policy Stance for H1, FY2017-18. Like started to bolster since many of the small startups
the previous half-yearly stance, this time too the are cracking big online deals now. Even now,
Central Bank took a cautionary approach towards discerning the market demand, the local furniture
money growth. Having discerned the trend of MPS players are expanding their span of market reach in
over the past 4 half-years, from expansionary to countries like Canada, Nepal, Bhutan and the like.
accommodative to cautionary, it is evident that the This phenomenon is a witness that Bangladesh is
economy is safeguarding itself from the drastically making international-standard furniture, which
falling remittance inflows, lower exports and cater to the taste and affordability of the burgeoning
possible upcoming high inflation risk. middle-class slice of the society.
04 18 32-33 NEW !
20
Furniture has been rightly regarded as one of the Telecom
booster sectors, which has employed approx. 2.2
34-35
million people in the country already. The sector
has a growth rate of 19% per year since 2010, NEW !
which demonstrates the colossal promise. New Idea!
12
Doctorola
Month In Brief
EXPERT OPINION
Rising from scratch
22 36 NEW !
Economy At a Glance
Selim H. Rahman For the Record
24
Chairman and MD, HATIL Complex Ltd
14 37 NEW !
Design & Printing: nymphea l www.nymphea-bd.com
Youth Leadership
NSU YES! Club
Analytics
Policy in Review Trends In Home
Monetary Policy Stance: H1,
FY2018 26 Loans Of Financial
Institutions
16 Trailblazers
In Conversation with
Anis A. Khan
38
IDLC News CEO & MD, Mutual Trust Bank Limited Capital Market Review
All rights reserved. No part of this journal may be reproduced in any form, by print, photoprint, microfilm or any other means without written permission from the publisher.
BANGLADESHS
FURNITURE
INDUSTRY
FORGING FORWARD
TO FLOURISH
By S. M. Farabi Ferdous
4 of 40
BANGLADESHS FURNITURE INDUSTRY
COVER STORY FORGING FORWARD TO FLOURISH
In Bangladesh, Micro and Small and Medium enterprises (SME) are of paramount importance.The knack
of SMEs to grow the industrial base and escalating the volume of foreign trade has made them a national
developmental priority, especially in terms of moving Bangladesh to a more sophisticated manufacturing and
service base than currently exists. Given the pre-eminence of SMEs in terms of creating jobs in the country, there
FINTECH
is an emphasis on selecting booster sectors, whichTHE have highFRONTIER
NEW promise IN
forBUSINESS/BANKING
growth and, within these, identifying
sub-sectors, which provide an overall impetus for economic growth. Furniture has been rightly regarded as one of
the booster sectors, which has employed approx. 2.2 million people in the country already. The sector has a growth rate
of 19% per year since 2010, which demonstrates the colossal promise. There are more than 75,000 SMEs in operation in
different parts of the country, having an average of 15 people working in a single enterprise. With no exception to the other
SMEs of the country, furniture enterprises are mostly male-owned, family run enterprises with a sole proprietorship.
5 of 40
According to Bangladesh Furniture Industries Owners At present two relevant associations i.e., Bangladesh
Association (BFIOA), currently, the countrys furniture Furniture Export Association and Bangladesh
exporters have been exporting to the US, Canada, Furniture Industries Owners Association (BFIOA) are
Australia, UK, Middle East, Gulf countries, and other actively working on materializing the potential of this
Asian countries, like India, Japan, Taiwan, Singapore, sector. Bangladesh Furniture Export Association has 19
Thailand and Vietnam. In the furniture market, the members.
major players are Otobi, Akhtar Furnishers Ltd, Navana
Furniture, Hatil, Partex Furniture etc. Sector Profile
A study on Export markets entry strategy for The rapid growing furniture sector of Bangladesh
Bangladeshi furniture manufacturers was conducted by constitutes approximately 70,000 enterprises all over
the Center for Industrial Studies (CSIL), an independent the country. Most of the enterprises are of small and
economic research and consulting company founded medium scale.
in Milan. The study shows that Bangladesh is able to
export USD 40 million by 2015 with an additional USD Micro &
10 million export of accessories & soft furnishing. This Firm Size Medium Total
Small
export volume can increase up to USD 1 billion by 2020,
provided that there is increased productivity, better No. of Enterprises 70953 81 71034
market linkage and ensured compliance standards. Local market share
The potential can be materialized through exploiting at sales price (Billion 42.2 24.45 66.65
low labor cost which is a vital factor in becoming BDT)
competitive in the world market. In wood furniture Manpower involved
manufacturing, labor accounts for up to 40% of the total 1.77 0.03 1.8
(Millions)
costs. In Bangladesh labor costs account for 20% of the
production. Here, the hourly wage rate in furniture is The furniture industry in Bangladesh has been
between USD 0.06 - 0.40, less than in China (USD 0.50- experiencing healthy growth over the last 6 years. The
0.75) which is the largest furniture exporting country. domestic market is exhibiting an upward trend and is
currently worth BDT 67 Billion. (Source: EU Technical
Bangladesh Furniture Export Trend
Report, 2012) Also, within that time, exports of wooden
Source: EPB furniture has increased by CAGR 104% to USD 38.94
50 Million (source: EPB), while the total number of
45 42.58 38.94
40
enterprises has grown by 68% to 71,034 (source: EU
Export (USD Millions)
35 31 report).
30 27.14
25 21.38
19
20 The growth in terms of turnover is around 19% per
15
10
annum. The industry is currently employing about
5 1.80 million people directly. It has not been long since
0
2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015 Bangladesh started exploring the export market, but
within a very short span of time, local manufacturers
Industrialization is the only way for a developing country have started exporting to the USA, Japan, European
like Bangladesh to gain in economy. Our goal to emerge countries, various provinces in India and other South
as a middle income country by 2021 much depends on East Asian countries. In the export market, the average
how we can explore and commercialize our industries. export growth of the furniture industry has been slightly
Though Bangladesh is mostly known for its garments above 20% annually. In the last fiscal, the country
and textile industries, there are other industries that achieved 16% growth in furniture export to earn over
have the potential to capture the global market in the USD 31 million according to Export Promotion Bureau
near future. Furniture sector is one of them. Furniture data. In the Fiscal 2009-10, the furniture export volume
sector was included in the Export Policy, 2009-2012 as a was USD 19 million while it amounted to USD 21
Special Development Sector and in Export Policy, 2012- million in 2010-11 and USD 27 million in 2011-12.
2015, it has been upgraded as a Highest Priority Sector There is a huge opportunity, but the sector needs a large
due to extreme export potentials. number of skilled workers to meet the rising demand.
6 of 40
CATEGORY FURNITURE
HOME FURNITURE
Bed Bed as a single item holds the majority of the market share
among all home furniture. Solid wood is the main raw material
used to produce bed frames. Among other alternative materials,
processed wood, metal, and cane are also used.
Sofa The major raw materials used to produce sofas are solid wood
(sometimes processed wood, cane or metal), upholstery fabrics
and sponge-foams.
Cabinet There are different types of cabinets used in a home scenario like,
kitchen cabinet, show cabinet, dinner cabinet, cabinet for clothes,
storage cabinet etc. The major raw materials used to produce
cabinets are processed wood (sometimes solid wood), glass etc.
Table Dining tables, side tables, center tables, study tables, dressing
ENGAGED tables etc. The major raw materials used in table production are
ENTERPRISES solid wood (sometimes processed wood), glass, mirrors, metal
pipes etc.
75,000
Chair The major raw materials used to produce chairs are solid wood
EMPLOYMENT (sometimes processed wood and metal pipes), padding materials
(sponge-forms etc.), upholstery fabrics etc.
CREATION
2.5 MILLION Accessories Stools, hangers, wall shelves, shoe racks, mirror frames, bowls,
showpieces etc. Solid and processed wood, metal pipes, mirrors,
glasses, etc. are the main raw materials for production of such
EXPORT items.
DESTINATIONS
US, Canada, Australia, OFFICE FURNITURE
UK, Middle East, Gulf
Tables Office tables can be defined as different types like executive
countries, and other
tables, working tables, work stations, conference tables, computer
South Asian and East tables, etc., which are mostly produced using processed wood
Asian countries (sometimes solid wood), glass, locks, etc.
Chairs Office chairs are mostly made out of metal pipes (sometimes solid
and processed wood), padding materials (sponges, foams, etc.),
plastic, upholstery fabric (sometimes PU), mechanical, adjusting
device, etc.
Shelves and Shelves and cabinets used in office spaces are produced out of
Cabinets processed wood (rarely solid wood and metal pipes), glass etc.
Waiting lounge Used at offices and hotels; are made out of processed wood
sofas (sometimes solid wood and metal pipes), upholstery fabric or PU
etc.
Ship Furniture Ship requires all kinds of furniture including the home and office
range, furniture for hotels and restaurants.
7 of 40
In the last fiscal, Bangladesh earned USD 7 million target of about USD 38 million with 20% growth for the
from the furniture export to the US market and then current financial year while the government has set the
USD 5 million from the Swedish market. Meanwhile, total export target of USD 30.5 billion.
the Ministry of Commerce has set a furniture export
Based on material used to produce furniture, the SMEs in Bangladesh can be categorized according to the table below:
Majority of the raw materials used in the sector world in recent years. Processed wood furniture
are import based and the import duties are quite is replacing solid wood furniture gradually.
high on processed wood (92.30%), which is now Therefore, the high import duties on major raw
becoming the main raw material to produce materials may hinder in achieving competitiveness
furniture in the global furniture Industry. The in the export market. Cane and rattan furniture
duty on solid wood is 10.72%, which is low but due are environment friendly and are mostly used in
to the cost and environmental reasons, use of solid home furniture like, sofa, chairs, tea-tables and for
wood in furniture is getting reduced in all over the other decorative purposes.
Supplier Manufacturer
Retailer
Customer
Manufacturer Distributor
8 of 40
Top players
Established 1969
Product profile Wooden, Melamine Laminated Chip Board, MDF, Cane and Metal furniture
No. of Showrooms 64
Established 2001
Product profile Home furniture, office furniture, project furniture, doors, wardrobes, sawn timber
No. of Showrooms 44
9 of 40
Akhtar Furnishers Limited (AFL)
Akhtar Furnishers Ltd (AFL) commenced its business in 1976. At present, around 800 people are directly working under
the shade of Akhtar Furnishers Ltd. The company have their own seasoning capacity of 2000 cft. solid wood a month.
The annual production volume of the company is BDT 1,200,000,000.
No. of Showrooms 32
SWOC Analysis
10 of 40
Unfavorable tax and import duty policy The chief raw materials used are wood, laminated board,
Industry is overtaking carpentry which may result wrought iron furniture, and processed wood & medium
in the loss of hand carving skills density fiber wood, particle board and rattan bamboo.
However, most of these materials need to be imported.
Of the woods; Tic, Gamar and Hardwood come from
Value Chain Analysis Africa, while Barmatic wood comes from Myanmar.
(The writer is a Senior Executive Officer, Credit Risk Management and can be reached at ferdous@idlc.com)
11 of 40
SELIM H. RAHMAN
EXPERT OPINION CHAIRMAN AND MANAGING DIRECTOR, HATIL COMPLEX LTD.
Selim H. Rahman
Chairman and Managing Director, HATIL Complex Ltd.
MBR: Please tell us something about how HATIL was on the spot, and said that instead of buying the timber
started. from me, she would be purchasing doors instead! This
was how HATIL was established in 1989. Then, the
SHR: My father, the late Al-Haj Habibur Rahman, customers who bought doors for me began demanding
founded H. A. Timber Industries Ltd., in 1966, and for furniture. Hence, arising purely out of customers
used to only sell timber. Previously, the practice was needs, HATIL began manufacturing furniture.
that people would buy wood and have carpenters build Although, HATIL is renowned for selling furniture, we
the furniture in their homes. I worked for my father actually started out by selling doors.
for two years, doing the same work that he had been
doing. Although the business was doing well, I was not MBR: What is the significance behind the name
enjoying my work. HATIL?
12 of 40
However, the scenario is quite different now. A customer diesel fuel for the generators, on top of paying BDT 25
would like a product in our showroom, and insist that lacs for the electricity bill. Delays at the port also cost
we send him a fresh piece from our warehouse, without us, both in terms of money and time. Moreover, the
verifying the quality of the product. This shows the poor road conditions make it very expensive to send
immense faith that customers have in our products products from Dhaka to the Chittagong port. However,
and in our company. This positive perception and faith our biggest cost challenge, is the incredibly high import
of customers could be a big contributing factor to our duties on raw materials.
success.
Since Bangladesh has to import most of the raw
MBR: What do you think about the furniture industry materials for manufacturing furniture, the import duties
in Bangladesh? are incredibly high. Even though the Government has
agreed to give us an incentive of 15% i.e. 15% of the
SHR: At present, the furniture industry in Bangladesh import duty would be covered by exports, it is still not
has two types of players there are the smaller enough. We cannot also avail the governments bonded
companies who buy wood, hire carpenters and make warehouse facilities since we do not have a 100%
furniture, and then there are some big companies export-oriented factory. Unless we are sure of getting
who have achieved the international standard and are orders which will maximize the new factorys capacity
manufacture furniture using machines. However, there utilization to the fullest, we cannot go for such ventures.
is a lot of scope for growth in the furniture industry
of Bangladesh. Just like the garments industry, the MBR: How does HATIL differentiate itself from its
furniture industry is labor-intensive, and can create competitors?
jobs on a massive scale. With the implementation of the
right Government policies, the furniture industry could SHR: In the past, furniture in Bangladesh were old
be the second largest exporting sector, after RMG. fashioned, stocky in build and took up a lot of space.
These sorts of furniture were best suited for the large
MBR: What challenges did you face when you started houses that were very popular in the past. When I see
out? How do they differ from your current challenges? furniture stores in Mirpur, still selling those antiquated
designs, I notice that they waste almost 50 cft of wood
SHR: Initially, when I started out, I had limited capital. making those furniture. If all the shops in Mirpur are
Additionally, carpenters would require advances, but doing the same thing, just imagine how much wood is
then delay coming back from holidays, which would in being wasted! I consider this a waste of the countrys
turn cause production to halt for days. Since, furniture natural resources.
manufacturing is a technical job, carpenters would
try to dominate negotiations, which was also quite We also ensure that we never compromise on quality;
challenging. starting from sourcing the best raw materials to smoothing
the production process we ensure that consumers get the
The current challenges that we face are quite different best quality products from us. We have been practicing the
from our past challenges. The biggest challenges we are Japanese quality management philosophy Kaizen since
facing now are in terms of cost, which is hampering 2007. Additionally, we care deeply for the environment
our price competitiveness in international markets. and won the HSBC-Daily Star Climate Award in the
Every month, we are paying BDT 14 lacs to purchase Green Operation Category in 2013.
13 of 40
POLICY IN REVIEW MONETARY POLICY STANCE: H1, FY2018
The Monetary Policy Statement (MPS) for the first half mitigated by the subdued global inflation brought
(H1) of 2018 was announced on July 26, 2017 by Fazle on by the tightening of money supply in the US
Kabir, the Governor of Bangladesh Bank. Bangladesh and the EU, and the low inflation prevailing in
Bank (BB) decreased its credit growth targets for both India. Bangladesh Banks FY18 monetary program
the public and private sectors due to the slow investment intends to set a cautious, flexible course to contain
trend. A cautionary stance was adopted after taking the annual average CPI inflation within the set
into account falling remittance inflows, lower exports, target ceiling of 5.5%.
and rising inflation risks.
GDP (Gross Domestic Product) growth was 7.24%.
Highlights of Monetary Policy Statement (MPS): A target of 7.4% real GDP growth has been set for
July December 2017 (H1) FY18. Although, the output growth momentum
looks robust, low FY17 export growth of 1.7% and
Broad Money (M2) grew by 11.7% against the workers remittance inflow downturn to negative
FY17 ceiling of 15.5%. The FY18 monetary 14.5% pose threats to the external and local
program has set 13.9% growth ceiling for M2, and demand led growth outlook for FY18.
a 12% yearly average growth ceiling for Reserve
Money (RM). An annual average has been adopted
To support the Governments inclusive and
for the first time, in place of the point-to-point
environmentally sustainable production and
target for RM, for improved adherence with the
employment growth goals, policy supports for
chosen monetary stance. The benchmark repo rate
financing of farm/non-farm MSME output
remains unchanged at 6.75 % following a review.
initiatives will be continued, with greater emphasis
put on employment focused sectors, and green
Domestic Credit grew by 11.3% against the FY17
projects of adopting environment friendly
ceiling of 16.4%, and has been set at 15.8% for
production practices. Additionally, the Central
FY18. Private Sector Credit Growth was 16%
against the FY17 ceiling of 16.5%, and has been Bank has plans of taking initiatives to facilitate
set at 16.3% for FY18. Increase in the net sales of FDI through dedicated help desks/support units in
National Savings Certificates (NSCs) caused public banks.
sector bank borrowing to fall to negative 16.2%,
causing domestic credit to remain well below the Multidimensional efforts are being made to
FY17 monetary program ceiling. Growth ceiling gradually transform Bangladesh Banks present
for Public Sector Credit has thus been set at 12.1% monetary targeting policy based framework
for FY18. to a financial price targeting based framework,
and this is expected to continue in FY18, with
Mean inflation decreased to 5.44%, below the especial importance given to improving BBs
FY17 ceiling of 5.80%. However, the upward trend forecasting abilities, and getting rid of obstructions
in food prices, caused by the flash floods in the to market-based financial pricing, including high
haor regions during the fourth quarter of FY17, NPLs (Non-performing Loans) arising out of slack
are indicative of an inflation outlook. Some of the lending practices, and non-market pricing of the
risks associated with domestic inflation may be Governments non-bank NSCs borrowings.
14 of 40
MAJOR INDICATORS MPS
REMITTANCE
FOR THE LAST SEVERAL 1600
1465.68
HALF-YEARLY MONETARY 1400
1200
1338.31
INFLATION
8.50% BROAD MONEY
7.48%
7.50% 7.03%
7.47% 7.05% 16.43%
13.76%
6.50% 6.10%
13.55% 13.40%
5.71% 13.07%
5.50% 5.92%
5.51%
5.49%
4.50% 4.90% 4.56% 4.51%
3.50%
General Food Non-Food
2.50% Dec 15 Jan 16 Feb 16 Mar 16 Apr 16May
16 May 16 Jun 16 Jul 16 Aug 16 Sep 16 Oct 16 Nov 16
Jan 16Feb
16Feb 16Mar
16Mar 16Apr
16Apr 16May
16May 16Jun
16Jun 16July
16July 16Aug
16Aug 16Sep
16Sep 16Oct
16Oct 16Nov
16Nov 16Dec
16Dec 16
Broad Money (M2) grew by 11.7%, well below
Average CPI Ination gradually declined to 5.44% the FY17 ceiling of 15.5%, and was a key player in
in June 2017, well below the programmed FY17 helping contain the CPI ination of FY17.
ceiling of 5.80%.
In FY17, the intermediation spread between Private Sector Credit Growth grew by 16% in May
weighted average rates on bank deposits and loans 2017, well within the targeted ceiling of 16.5%,
has narrowed by only 12 basis points, reecting high and helped increase private investment and
levels of NPLs in banks with lax lending disciplines. consumption.
15 of 40
IDLC NEWS IDLC NEWS
Dhaka Bank Limited signs MoU with IDLC Finance Limited for partnership on various financing facilities
IDLC Finance Limited countrys leading Non-Banking Mr. M. Jamal Uddin, Deputy Managing Director &
Financial Institution has recently partnered with Dhaka Head of Business of IDLC Finance Limited and Mr.
Bank Limited one of the reputed banks in the industry. Emranul Huq, Additional Managing Director of Dhaka
The purpose of this partnership is to have a synergy
Bank Limited formalized the signing in an agreement
between the organizations. Through the MoU signing it
signing ceremony. The Ceremony was adorned with the
is expected that both the entities will have a successful
partnership for implementation of financing medium to presence of Mr. Arif Khan, CEO & Managing Director
large-scale projects for Corporates in the area of Trade of IDLC Finance Limited. Senior officials of both the
Finance, Agency Service and Treasury Deals. organizations were present during the signing ceremony.
1st session on Environmental & Social Risk Management for IDLC employees
As a part of E&S Teams activities on capacity Comparison between ERM 2011 & ESRM 2017
development program of IDLC Employees, the 1st Frequently Ask Questions regarding ESMS Software
session on Environmental & Social Risk Management
Sector specific checklists & Corrective action plan
of IDLC employees was held on July 27, 2017 at IDLC
before financing
Knowledge Center.
It was a half-day session for business RMs & CRM E&S team will arrange another 2 sessions by this year
representatives with the covered Issues like: for building readiness of IDLC employees on E&S Risk
Management which is now an integral part of credit risk
New ESRM 2017 Guideline of Bangladesh Bank assessment and sustainable business practice.
16 of 40
IDLC NEWS HALF-YEARLY EARNING DISCLOSURE OF IDLC
1st Half 2017 (January June 2017) Performance compared to 2.34% and 22.30% respectively, in the
Highlights of IDLC Finance Limited: same period last year. The NPL (Non-performing Loan)
ratio stood at 2.84% as at June 30, 2017 compared to
Net Profit After Tax of BDT 1,169mn, 33% year on 2.98% as at December 31, 2016.
year growth
Diluted Earnings Per Share (EPS) in H1 2017 is
BDT 3.28 against BDT 2.72 in the same period last While our core
year lending business
Customer assets grew by 13% in 2017 to reach BDT
70bn continued its
IDLC Finance Limited reported Net Profit after Tax
growth momentum
of BDT 1,169mn in the first half of 2017, recording a and delivered
substantial growth of 33% from the same period last consistent nancial
year. Earnings per Share (diluted) also increased 21% to
reach BDT 3.28 for the period. performance
In these 6 months IDLC acquired 5,779 new customers
in the rst half
and grew the Customer Assets portfolio by 13% or year of 2017,
BDT 7,927mn to end the first half with a loan book our subsidiaries
of BDT 70bn. This growth in customer assets was
driven primarily by the SME Loans, which experienced
produced
a healthy 18.6% growth in this period. SME loans exceptional results
currently comprise 45% of the total loan book of IDLC to elevate the
with close to BDT 31bn. The other business segments
of the company - Corporate and Consumer Finance overall protability
and, especially the two major subsidiaries IDLC to a new height
Investments Limited and IDLC Securities Limited
also delivered strong performance. Arif Khan
CEO & Managing Director
In the reported period, IDLCs annualized ROA and IDLC Finance Limited.
ROE figures stood at 2.77% and 22.89% respectively,
17 of 40
PERFORMANCE ANALYSIS OF
TOP 10 COMMERCIAL BANKS* WITH IDLC
TOP 10 COMMERCIAL BANKS*
BRAC Bank Limited Pubali Bank Limited * Considerations
Dutch-Bangla Bank Limited Southeast Bank Limited 1. Period of the financials:Half-yearly
Eastern Bank Limited The City Bank Limited 2017
Islami Bank Bangladesh Limited Trust Bank Limited 2. Based on two criteria :Loan
Prime Bank Limited United Commercial Bank Limited PortfolioandNet Profit after taxes
0.0%
IDLC Trust BRAC Eastern Dutch-Bangla The City Islami United Pubali Southeast Prime
Finance Bank Bank Bank Bank Bank Bank Commercial Bank Bank Bank
Limited Limited Limited Limited Limited Limited Bangladesh Bank Limited Limited Limited
Limited Limited
18 of 40
LOAN PORTFOLIO 20.0%
17.3%
18.0%
GROWTH 16.0%
(Y-T-D, %) 14.0% 12.7%
12.0%
9.3%
10.0% 8.2% 7.9% 7.4%
8.0% 6.1% 5.8%
6.0% 5.0%
3.4% 3.1%
4.0%
2.0%
0.0%
Trust Bank IDLC Finance Eastern Bank Islami Bank Southeast Dutch-BanglaThe City Bank United Pubali Bank Prime Bank BRAC Bank
Limited Limited Limited Bangladesh Bank Limited Bank Limited Limited Commercial Limited Limited Limited
Limited Bank Limited
0.5
0.0
Islami BRAC The City Eastern Dutch-Bangla United Southeast Trust IDLC Pubali Prime
Bank Bank Bank Bank Bank Commercial Bank Bank Finance Bank Bank
Bangladesh Limited Limited Limited Limited Bank Limited Limited Limited Limited Limited
Limited Limited
NON-PERFORMING 9%
8% 8%
LOAN 7%
5.9% 6%
31st December,2016 6%
5.2% 5.4%
5% 4.8%
4% 3.9%
3.2% 3.4%
3% 2.8% 2.98%
2%
1%
0
Eastern IDLC Trust BRAC Islami Southeast Dutch-Bangla Pubali Prime The City United
Bank Finance Bank Bank Bank Bank Bank Bank Bank Bank Commercial
Limited Limited Limited Limited Bangladesh Limited Limited Limited Limited Limited Bank
Limited Limited
19 of 40
NEW IDEA! DOCTOROLA
DOCTOROLA
Doctorola.com is a tech-based startup whose purpose is to make healthcare service delivery easily accessible and
convenient, to make positive impacts in peoples lives. It is the pioneer online doctor appointment service platform
in Bangladesh, which provides information about doctors and appointments in real-time through a fully integrated
system. The company has displayed remarkable growth over the last two years, and recently, MBR had an opportunity
to have a one-to-one conversation with Mr. Mohammad Abdul Matin Emon, Founder, Managing Director & CEO of
Doctorola.
20 of 40
business. Doctorola is the first Bangladeshi startup to changing this mindset of patients; although there
raise investment funds using venture capital. has been some progressive change, there is still a
long way to go.
Doctors Mindsets
Future Aspirations
Initially, when the company first started out, doctors
At present, Doctorola deals with around 500 patients
were unwilling to sign up on Doctorolas platform,
daily. The companys vision is to increase this number
unimpressed by the companys initiative, and having no
to 30,000 patients by 2020, which would still only be
faith in the business proposition. After the first three
5% of the total number of people who require medical
months of establishing the organization, Mr. Abdul
attention in Bangladesh on a daily basis.
and his team were only able to convince 19 doctors to
join their platform. However, over the last two years,
The company also offers discounts on hospital tests
Doctorola has been greatly able to overcome this
to make treatments more affordable for the patients.
challenge by convincing doctors all over Bangladesh
Currently, Doctorola is offering this benefit to 37
of the benefit of joining its cause. Currently, there
hospitals it intends to increase this number in the
are around 7,500 doctors who have partnered with
future. The company is in partnership with 500 hospitals
Doctorola, ranging from small and mid-level doctors at present; it aspires to be connected with every hospital
to well-known specialists. In the past, the company had in Bangladesh in the future.
to spend hours trying to convince doctors to join their
cause; at present, there are around 20 to 25 new sign ups Doctorola is working on establishing more partnerships
on Doctorola, on a daily basis, with doctors proactively to create more valuable products. The company intends
contacting the organization themselves. Changing the to bring telemedicine to Bangladesh within the next
mindset of doctors and the processes of the hospitals two months. Telemedicine means remote consultation
has been an immense challenge which Doctorola was a man, living in the rural areas, could opt to consult a
able to successfully overcome. doctor in Dhaka over video conferencing.
21 of 40
KEY
INFO
PRIVATE SECTOR CREDIT GROWTH SME CREDIT DISBURSEMENT
16.03%
in May 17
BDT 1128.98
July-March, FY 2016-17, 22.38% Growth Y-O-Y
bil
22 of 40
ECONOMY AT
A GLANCE
llion
SEEING ECONOMIC
TREND IN DATA
SPREAD OF LENDING LIQUIDITY POSITION OF
& DEPOSIT RATE THE SCHEDULED BANKS
0.59%
7.62%
Specialised Banks
11.09% State owned Banks
4.85
4.84 Private Banks
41.20% (Other than Islamic)
4.8
4.76 Private Banks (Islamic)
4.72 4.73
4.7
4.71 4.69 Foreign Banks
4.65 4.69
4.65
39.50%
Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Total liquid assets for December 2015 was BDT 2577.94 billion
INFLATION EXPORT
2% 41%
6.98% 7.00%
6.19%
5.58% 5.33% 4.49% 6.89% 6.94% 7.37% 7.51%
6.53% 6.84%
JUTE WOVEN GARMENTS
5.10% 5.56% 5.41% 3.10% 3.07% 3.30% 3.44% 3.67%
3.18%
4.35% 4.30% 5.38%
42% 2% 19%
13%
Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 KNITWEAR FROZEN FOOD OTHERS
Inflation rate in June 2017 increases as non-sood inflation creeps up
23 of 40
YOUTH LEADERSHIP NSU YES! CLUB
NSU YES! (Young Entrepreneurs Society) Club is the premier business club in North South University, dedicated to
youth development, and youth empowerment by means of various informative and challenging events, seminars and
workshops. Since its inception in 1994, the club has always thrived to create a platform to advocate future entrepreneurs,
and is currently renowned as the best student-run organization amongst all universities in the country. MBR recently
had an opportunity to have a one-to-one conversation with Farhana Shahnaz, the current treasurer of NSU YES! Club.
MBR: Tell us about the start of this club. where teams from all across the nation faced cases and
eliminations, with each round being more challenging
NSU YES! Club: The chief grounds behind the formation than the previous.
of NSU Young Entrepreneurs Society (NSU YES!) Club
was to offer a powerhouse to the most creative and The club is also responsible for the biggest marketing
passionate minds in the university where they could gain competition in the country in terms of the sheer number
the experience and knowledge needed to compete in the of participating teams and prize money, Ad Maker
vying world of leaders and executives. This is truly in line Bangladesh. Last year, the club had 305 teams from
with the YES! Motto - Join. Experience. Achieve. 50 universities across Bangladesh commencing on this
creative fight to win the crown of the best Ad Maker,
The journey began back in 1994 with only a handful of which was an immense achievement. Furthermore, NSU
members. The founding president was Shayukh Ahmed YES! also regularly conducts a series of seminars each
who led the club during 1994-1998. He is currently the year called NSUers Meet Corporate Icons (NMCI)
chairman and CEO of Xurtials, and he has devoted his
to help students gain hands-on advice from corporate
time and effort into making multiple ventures as an
leaders on how to prepare for the professional life that
entrepreneur. As founding general secretary, Chowdhury
awaits them in the future.
Abd-Allah Quaseed was responsible for arranging the
seminars and entrepreneurship promoting events, which
MBR: Briefly describe your recruitment process.
the club is so famous for now.
What qualities do you look for in potential members?
The current Executive Board is composed of Fahim Abrar
(President); Aurthima Naznoor (Vice President- External NSU YES! Club: The journey to becoming a fully-
Affairs); Zardar Rafid Sayeed (Vice President- Internal fledged Yes!er (member of NSU YES! Club) is a thorough
Affairs); Syed Rehan Ahmed (General Secretary); and and exhaustive one. Recruitment is held only once a year
Farhana Shahnaz (Treasurer). during the Spring semester. Interested students have
to fill out a form and face the initial interview round.
MBR: Briefly share the activities (competitions, Selected applicants may pass through to the evaluation
workshops, seminars) of this club. stage which is composed of various rounds that help
determine potential skills of the participants. This stage
NSU YES! Club: In 2017, NSU YES! Organized is essential as only a handful make it through to move
Masters of Ideation, an inter-university business strategy on to the next stage of the recruitment process. Selected
competition, for the fifth time in a row, which is renowned members prepare for the final interview with the
as one of the flagship events of the club. The competition Executive Body of NSU YES! who then narrow it down
kicked off with intra-university workshops and rounds to the future flag bearers of the club.
24 of 40
NSU YES! Club expects all of its members to display positions in respected multinational corporations, or
remarkable communication and leadership skills, while have taken the initiatives to start their own organizations.
also being adept at multitasking, since these qualities Following in that spirit, the club expects its current and
are essential for success in the future professional world. future members to carry on this legacy and achieve
However, the qualities which the club searches for most similar feats. The club believes that wherever YES!ers go,
in its members are passion and diligence, the kind that they should be able to triumph against all odds, due to
can be harnessed into bearing a vision someday. the plethora of educative and unforgettable experiences
NSU Yes! has given them.
MBR: What challenges do you face? How do you
overcome them? MBR: What are the clubs plans for the future?
NSU YES! Club: Just like every organization out there, NSU YES! Club: The clubs plans for the future include
one of the biggest priorities of NSU YES! Club is to keep wishing to not only continue hosting the aforementioned
its members as involved and interested in the club, as three events successfully every year, but also to take
possible. The club considers this their biggest challenge, these events to greater heights with every passing year.
especially once an event ends. In order to keep the team In addition to that, the club has plans to integrate with
spirit going, the club came up with Member Development youth oriented organizations such as SBYA (Social
Programs, and Leadership Programs, which include Business Youth Alliance) and GDG (Google Developer
competitions for debate, writing, and even sports. These Group) Sonargaon to help build a forum for its members
activities not only keep the team spirit going but also help which they can use to build networks and accelerate.
build and strengthen rapport amongst existing members.
Another common challenge which the club faces Just like every organization
regularly is helping members balance their club and
academic obligations. All the events hosted by the club out there, one of the
require intense commitment from all the members in biggest priorities of NSU
terms of time, and both physical and mental efforts.
Juggling club duties with academic responsibilities is YES! Club is to keep its
especially difficult if events overlap with exam sessions. members as involved and
Hence, the seniors in the club work to help out the newer
members deal with both responsibilities. interested in the club, as
possible. The club considers
MBR: How do you want to see your members down
the line once they get in the professional world? this their biggest challenge,
NSU YES! Club: It is quite a well-known fact that most
especially once an event
of NSU YES! Clubs respected alumni have either secured ends.
25 of 40
ANIS A. KHAN
TRAILBLAZERS MANAGING DIRECTOR & CEO, MUTUAL TRUST BANK LIMITED.
Anis A. Khan
Managing Director & CEO,
Mutual Trust Bank Limited.
Anis A. Khan, a Fellow of the Institute of
Bankers, Bangladesh (IBB), is the Managing
Director and CEO of Mutual Trust Bank Limited
(MTB). Prior to his current job, he served as the
CEO and Managing Director of IDLC Finance
Limited for six years. For 21 years, he was engaged
in a variety of roles with the then British-owned
Grindlays Bank plc. and its successors ANZ Grindlays
Bank and Standard Chartered Bank, both in Bangladesh
and overseas. Recently, MBR had the privilege of having
a one-to-one conversation with Anis A. Khan to get an
idea about his professional life, his insights on the current
financial sector of Bangladesh, his areas of interest and
experiences in life.
26 of 40
CAREER SNAPSHOT Office at Hadi Mansion, 2 Dilkusha Commercial Area,
Dhaka to meet Mr. Alan J Cooper (the Country Head
CURRENTLY SERVES AS: at that time), and asked to take over the role of the
Country Planning Manager (equivalent to todays
Vice Chairman of Industrial & Infrastructure
Development Finance Company Limited Chief Financial Officer). Khan was apprehensive
(IIDFC) about taking on this responsibility, as he did not have
Independent Director and Chairman of the an accounting certification; however, Mr. Cooper was
Board Audit Committee of Berger Paints quick to assuage his fears and encouraged him to take
Bangladesh Limited (BPBL) on the role, which proved to be invaluable for his
Director of BD Ventures Limited future career progression.
Chairman of the Board of Governors of the
Association of Bankers, Bangladesh Limited
Rebranding, and a new beginning
(ABB)
Member of the Council of the Institute of
Mr. Alan Cooper immediately sent Khan off to the
Bankers, Bangladesh (IBB)
banks Regional Head Office in Mumbai (Bombay in
Member of the Board of Governors of the
Dhaka School of Bank Management
those days), India for on-the-job-exposure under the
supervision of Mr. Arun Nangia (an engineering and
Vice President of the Bangladesh Association
of Publicly Listed Companies (BAPLC) business graduate who was the CFO equivalent of
Life Member of the SAARC Chamber of South Asia at that time). Nangia set up a comprehensive
Commerce and Industry (SAARC CCI) training program for him and he was sent on rotation to
Trustee Treasurer of the CSR Centre large departments across the Regional Head Office and
Bombay Main Branch. He had to learn the intricacies
of bank accounting including segmented balance sheets
and varied calculations relating to returns, productivity,
costs, etc. It was an incredible learning experience, by
PREVIOUSLY SERVED AS: which he was fast-tracked and prepared for his Country
Director of Eastern Bank Limited, 2004
Planning Managers role back in Dhaka.
2008
Independent Director of Chittagong Stock
In March 1986, he was appointed as Manager,
Exchange Limited (CSE), 2004 2008 Foreign Trade at the banks area office at Agrabad,
Director of the Credit Rating Agency of Chittagong. He was again sent off to Mumbai on
Bangladesh Limited (CRAB), 2004 2009 an intensive residential training course Finance
Bangladesh Rating Agency Limited of Foreign Trade (FOFT) conducted by Grindlays
(BDRAL), 2011 2013 International Training (GRIT), which equipped him
Vice President of the Metropolitan Chamber with the knowledge of foreign exchange and trade
of Commerce & Industry, Dhaka (MCCI) for operations including letters of credit, bills, guarantees
two terms 2014 & 2015 and indemnities. At that time, the banks major part
Chairman of Bangladesh Leasing & Finance of import and export business was conducted from
Companies Association (BLFCA), 2006 Chittagong, and the volumes were significant and
2009 work pressures quite intense.
Chairman of Primary Dealers Bangladesh
Limited (PDBL), 2014 2016 In mid-1987, Khan was appointed as Senior
Chairperson of the SWIFT Member & User Relationship Manager, Corporate Banking at the Area
Group of Bangladesh (SMUGB), 2014 2017 Managers Office in Chittagong. He then went on to
27 of 40
become the Area Operations Manager, Chittagong, after CEO & Managing Director of IDLC in early 2003. He
which stint he headed Operations, Administration, was initially reluctant to take up the job and return
Data Centres and Corporate Affairs at the banks Head to Bangladesh, so soon after settling down in Dubai
Office in Dhaka. He returned to Chittagong for one last and the varied banking exposure he was receiving.
stint as the Head of Business Banking and Area Head. However, his mentors and guides, both in the UAE
He was then given the responsibility of executing and Bangladesh, convinced him to return and take a
the Business Banking Proposition Project (BBSP) leadership role in the countrys expanding financial
of ANZ Bank in Bangladesh, under the guidance of sector.
the Country Head Muhammad A. (Rumee) Ali. This
project was executed in other countries by McKinsey Khan had spent 21 years in total with Grindlays Bank
& Co, International Consultants, and a dedicated team p.l.c. and its successor banks.
from the banks headquarters in Melbourne, Australia.
In Bangladeshs case, this was not to be so, and, thus, Tenure at IDLC Finance Limited
a determined Rumee Ali sent Khan to Melbourne,
Australia in 1999, to learn about the project and its At the time Anis A. Khan joined IDLC Finance
complex toolkits. On his return to Dhaka, Khan set Limited, it used to be called Industrial Development
about to execute the project, which was successfully Leasing Company of Bangladesh Limited and had
accomplished in December 1999, saving the bank only two branches one in Chittagong and the other
more than AUD 150,000 in fees and expenses. As a with the headquarters at Hadi Mansion, 2 Dilkusha
result of this project, the management and business Commercial Area, Dhaka. He believed that IDLC
flows, processes, and procedures in the Corporate had the potential to be a company offering multiple
Banking Division of the bank was fully modernized services, and should not only be limited to leasing.
and made customer-friendly. Therefore, with the support of the Board of Directors,
he ushered IDLC into an era of diversification and
In 2000, Standard Chartered Bank (SCB) acquired expansion.
ANZ Grindlays Bank branches and businesses all
the way from Greece to Bangladesh. Rumee Ali, He fondly remembers his colleagues during the
who by then had become the Country Head of both initial IDLC days - Syed Ehsan Quadir, currently the
ANZ Grindlays Bank and Standard Chartered Bank Managing Director of United Finance Limited, Md.
in Bangladesh, appointed Khan as the Country Minhaz Zia, former Managing Director of SABINCO
Integration Manager to spearhead the merger process and now Chairman of Asian Tiger Capital Partners,
of the two banks in Bangladesh, under his supervision, Arif Khan, the present CEO and Managing Director
mentoring, and guidance. He was also asked to take on of IDLC Finance Limited, the late Ashfaq Ahmed
the role of the newly created position of Head of Legal who headed Corporate Finance, Ziaul Hoque Khan,
& Compliance of both the banks. CFO, Bilquis Jahan, Head of Human Resources
and now carrying out the same role at BRAC Bank
The merger process went well despite many Limited and M. Jamal Uddin, currently IDLC Deputy
challenges, on completion of which he was selected Managing Director, all of whom he says are brilliant
as an expatriate employee in 2002 by SCB and posted and accomplished finance professionals, top managers
to Dubai, United Arab Emirates as the Regional Head and inspirational leaders. They and the other
of Legal & Compliance, The Gulf. This was another colleagues were supportive and helpful during the first
exciting learning role, giving him rich exposure to all phase of expansion and diversification that was most
parts of the bank across the UAE, Oman, Bahrain, and enthusiastically launched across the country. Under
Qatar. While in Dubai, Khan was offered the role of his leadership, the company began offering structured
28 of 40
finance products, syndication finance services, SME rebranding at the bank to help propel it forward.
loans, home loans, work order financing, factoring, Now in his ninth year at the bank, Khan, with the
an array of attractive deposit products and schemes, support of his management team and other colleagues,
capital market and merchant banking products and has expanded the branch network from thirty-six (36)
services, all of which were a resounding success with to one hundred eleven (111) and set up fourteen (14)
the rapidly expanding clientele. MTB Smart Banking Kiosks and two hundred and
thirty-four (234) ATMs. The bank has also introduced
He also believed in expanding the footprint, and the chip-embedded Visa and MasterCards, placed over
company set out to open branches in the major areas 3,000 POS machines with merchants, opened four (4)
of the capital city like Dhanmondi, Gulshan, Uttara bill collection booths and two (2) foreign exchange
and in Bogra. The Chittagong Office was relocated, booths, and a lounge at Hazrat Shahjalal International
expanded, and made most customer-friendly. After Airport (HSIA), Dhaka. The bank introduced Agent
a number of attempts, Khan was finally successful in Banking services in June 2016, and has in just over a
convincing the IDLC Board to purchase an entire floor year, opened twenty-five (25) such centers across the
in Bays Galleria, a landmark building in Gulshan 1, to country, as part of its financial inclusion endeavors.
which the Head Office was relocated from Dilkusha
in April 2006. He set up IDLC Securities Limited The bank has also set up a stock brokerage subsidiary,
MTB Securities Limited in September 2010, which
as a fully owned subsidiary of IDLC and the stock
has the largest branch network in the country and is
brokerage firm quickly became one of the leading ones
one of the leading firms in terms of volume. Another
in the country. He then set up the Merchant Banking
subsidiary company, MTB Capital Limited (MTBCL)
business under a separate Division, which also proved
was inaugurated in April 2011 and then MTB
to be successful. He also believed that the companys
Exchange (UK) Limited started operating in London,
name was too long and difficult to remember. Thus,
United Kingdom in February 2011.
he proposed changing the name to IDLC Finance
Limited, which idea was welcomed and approved by
In October 2010, MTB moved its Corporate Head
the companys Board of Directors. This name has now Office to MTB Centre in Gulshan, Dhaka from where
become well established and well branded across the the banks business and operations are now managed
country, giving instant recognition to its products from a well-equipped modern and functional building.
and services and activities. Khan recounts his six The bank also inaugurated its own 12-storied building
years at IDLC to be a rewarding, wonderful, and an - MTB Tower, on Kazi Nazrul Islam Avenue (Bangla
unforgettable experience. Motor) in October 2014, which houses amongst
other divisions and departments, a state-of-the art
His work at MTB so far auditorium and conference centre.
Anis A. Khan joined Mutual Trust Bank Limited (MTB) MTB is now well poised to expand its business and
as its Managing Director and CEO on April 15, 2009. clientele and become one of the most sought-after
Interestingly, he again started working in an office in banks in the country and an employer of choice for
Dilkusha Commercial Area, where the headquarters the younger generation coming into the work force.
of MTB was located. The members of the MTB Board
of Directors are renowned entrepreneurs and business Leadership in Bank and NBFI
leaders of the country, and they gave Khan a clean
chit to build the bank anew. As is his hallmark, he What makes Khan an erudite professional is the
unleashed an era of expansion and diversification and experience of leading both a bank and an NBFI, and
29 of 40
being the Chair of both the concerned associations, the banking and non-banking financial sectors in this
namely: (Association of Bankers, Bangladesh Limited area. However, Khan believes that since Bangladesh is
(ABB) and Bangladesh Leasing & Finance Companies more prosperous now and has better macroeconomic
Association (BLFCA). As opined by Khan, while
indicators and higher foreign reserves, some
both banks and NBFIs (Non-banking Financial
liberalization would be welcome for the marketplace
Institutions) are quite similar in terms of processing
loans of different types and having similar capital and entrepreneurs. Although, there have been many
market responsibilities, they have certain underlying relaxations in regulations, it is still not enough in
differences. Although both institutions offer similar comparison with other countries. He believes that
services in certain sectors, banks operate on a larger especially in trade (exports and imports), there
scale. They are licensed to conduct multifarious should be more liberalization; and the exporters and
operations, which makes them versatile in terms
importers should be able to conduct business, free of
of offering services in the areas of Retail Banking,
Corporate Banking, Islamic Banking, SME Banking, hassles, up to certain reasonable limits.
and so forth. Banks also deal with cash transactions
and have a variety of payment instruments, which Reforms both sectors should implement
NBFIs do not. Additionally, banks have to worry
about both physical and cyber security and remain on Mr. Khan previously served as the Chairman of
constant guard against thefts, frauds, and forgeries. Bangladesh Leasing & Finance Companies Association
Compliance with rules and regulations including
(BLFCA), and is currently serving as the Chairman of
Anti-Money Laundering (AML) and Combating the
the Board of Governors of the Association of Bankers,
Financing of Terrorism (CFT) are other key areas,
banks have to constantly concentrate on. Bangladesh Limited (ABB).
30 of 40
The Art Aficionado a close friend, a professional acquaintance, or an
employee - he makes it a point to wish everyone
Anis A. Khans passion for art was cultivated from a on his or her birthday and anniversary. Even if he
young age. When he was in Faujdarhat Cadet College is physically unable to meet or talk to these people,
(FCC), he wished he could paint as well as his friends he ensures that he sends them little notes or text/
did, however he says he was not gifted in this area. WhatsApp messages, on their special days. He likes
His fondness for art began with his admiration of
making people feel special; this may be in the form
his friends sketches and paintings. When he was a
of attending weddings or by consoling a bereaved
teenager, he used to cut out photos of paintings from a
person. He believes in sharing whatever he has
calendar published by a German company called Bayer,
and paste it on his walls. Looking at his wall adorned with people around him, as he feels that material
with these pictures, helped grow his appreciation for possessions are temporary, but people and memories
the works of the old masters like Leonardo Da Vinci, are forever.
Raphael, Rembrandt, Van Gogh, Monet and Picasso
and led to his yearning to collect paintings for himself. Khan puts a lot of emphasis on being people-oriented.
When he ventured into the professional world, he He said that he has had a fondness for people all
started his collection by buying paintings of typical through his life, and he tries hard to be thoughtful
Bangladeshi landscapes, costing around BDT 2,000
and caring. These qualities, apart from making him
or BDT 3,000. However, he remembers that he could
not even afford those and often paid the art dealers in a revered and much sought-after professional, have
installments. He even used to take loans to be able to helped him earn many cherished friends for life.
buy paintings.
31 of 40
INDUSTRY
UPDATE
BOOM TIME FOR PLASTICS
Due to diversification in
PLASTIC the manufacturing process,
Bangladeshs plastic industry is booming and
contributing significantly to the national economy.
Currently, there are 3000 plastic products
manufacturing units which employ around 1
million people. Hygienic plastic pallets, used
to package raw materials of various industrial
products, are now being manufactured locally.
Plastic products are exported to more than
106 countries. The basic material required for
producing plastic products is polymer. The lack
of poly-olefin units ensure that the country imports
100% of polymers in addition to 150,000 metric
tonnes of raw plastic, per annum. Additional
challenges include a lack of modern technology,
world-standard knowledge, skills, and experience,
and capital resources. However, existing reserves
of natural gas and petroleum fields offer prospects
of setting up a poly-olefin plant in Bangladesh.
32 of 40
HUGE GROWTH POTENTIAL
IN STEEL SECTOR
Bangladeshs steel
STEEL manufacturing sector has
an immense growth potential, contributable to
growing construction activities, rising demand
and positive trade prospects. Large investments
by steel mills ensured that the annual billet
production has risen to almost 40 lac tonnes,
putting the country on the course to become
self-sufficient in billet manufacturing. Billet
imports, due to the duty hike, and increased
local production, decreased by 34% to 11.57 lac
tonnes, year-on-year. The country may even be
able to export billet soon. Scrap imports rose by
99% to 21.64 lac tonnes, to support the industrys
move into backward integration. Presently,
Bangladeshs annual steel consumption is around
eight million tonnes, which may grow to eighteen
million tonnes by 2030. Coordinated investment
and bilateral cooperation with India could propel
the local industry to new heights in the near future.
TELCOM
4G IN BANGLADESH
Private mobile operators predict low returns against the
BDT 22,600 crore required to be invested for 4G services in
Bangladesh. This is contributable to high spectrum charges
and taxation, coupled with low 4G device penetrations and data
price rates. The government recently proposed base prices/
megahertz to be USD 30 million (900 MHz bands), USD 35
million (1,800 MHz) and USD 27 million (2,100 MHz). The
operators demand for price/MHz to be below USD 15 million,
reasoning that revenues were decreasing against increasing
data consumption. The top three mobile operators have
already tested their 4G networks and found 50 100 Mbps
of upload and download speed, which is significantly higher
than existing 3G services. Currently, only mobile operators
Grameenphone, and Robi are offering their customers the
opportunity to convert their existing SIMs to 4G Sims. Both
the government and the operators are optimistic to launch 4G
services as soon as possible in the country.
33 of 40
MONTH IN BRIEF
up 42% as a
FDI fail to reach heights
despite having huge
source for Bangladesh
textile sector due to its
result of slower
growth of exports
up by potential in home textile,
as duty benefits were
cost effectiveness
extended to Pakistan, a
compared to
higher growth of
almost cotton grower whereas
Bangladesh is a 100%
28%
cotton importer
imports
Bangladesh Savings
18
China is the third certificates sell like
25
European Union (28) largest apparel hotcakes with 55%
Bangladesh
28
161 exporter after growth in FY17.
Vietnam China and the Savers switch
117
India EU: World Trade sides as banks
Organization squeeze
(WTO)
Top ten exporters of clothing, 2016 interests on
(USD billion and annual percentage change,%)
deposits.
34 of 40
MONTH IN BRIEF
35 of 40
For the Record
WELL 50%
Bangladesh accounted for a
share in the GCC labor
NOT SUPPORT
market, ahead of India and
Pakistan
GROWTH AT
according to a statistics by
Indianexpress
THE COST OF
INFLATION. Import duty
FAZLE KABIR, Governor, Bangladesh Bank
in the wake up recently published cautious Monetary
cut has led to
Policy Stance for Jul-Dec,FY17-18
the decline in
'Respect paddy prices
is a two-
This significantly,
way street process
as stockists
and Uber's is cost
community started selling
guidelines
effective
out their
help and
paddy fearing
reiterate easier.
that MASHRUR AREFIN,
a fall in prices
clearly and Additional Managing Director
and Chief Communication GENERAL SECRETARY KM LAYEK ALI,
concisely Officer of City Bank in
response to banks opting for
Bangladesh Auto Major Husking Mill Owners
Association (BAMHMOA) on recent plunge in
in both bonds to raise capital rice price
English and
Bengali'
IT WONT BE FAIR IF THE PRICE IS HIKED
said Uber in a
statement announcing WITHOUT ANY VALID REASON.
their 'community
guidelines' for both GHULAM RAHMAN, President of Consumers Association Bangladesh on
riders and drivers hike of edible oil price twice in this calendar year
36 of 40
ANALYTICS
SEEING
TRENDS
IN THE
DATA
THE WAY WE WORK NOW Home loans in the banking sector have seen steady growth
over the last decade. Informal home loans arise out of
TRENDS IN HOME savings, and loans from friends, and family. Formal home
LOANS OF FINANCIAL loan providers include banks (around 80%), financial
INSTITUTIONS institutions, and specialized housing finance providers.
Total outstanding home loans provided by the formal sector
had a CAGR of 20.02% in 2016. As of June 2016, Private
Commercial Banks provided the highest amount of loans,
and Micro-Credit Lenders the lowest. Delta BRAC Housing
(DBH), the leading specialized housing finance institution,
sources most of its home loans from customer deposits.
Total Outstanding Home Loan Outstanding Home Loan of PCBs Outstanding Home Loan of BHBFC
FY-05-16 ( BDT billions) (in BDT billions) (In BDT Billions)
600 350
35
500 300 30
250 25
400
200 20
300
150 15
200
100 10
100 50 5
0 0 0
FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY
05 06 07 08 09 10 11 12 13 14 15 16 05 06 07 08 09 10 11 12 13 14 15 16 05 06 07 08 09 10 11 12 13 14 15 16
Source: BB Source: BB Source: BB
Outstanding Home Loan of DBH Trend of Home Loan to Total Loan % of NPL to Home Loans & Total Loans
(In BDT Billions) 9.00%
7 8.00%
40
35 6 7.00%
30 6.00%
5
25 5.00%
4
20 4.00%
15 3
3.00%
10 2
2.00%
5 1
1.00%
0
FY FY FY FY FY FY FY FY FY FY FY FY 0
0.00%
05 06 07 08 09 10 11 12 13 14 15 16 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2006 2011 2014 2016
Source: BB Source: Survey Data Source: Survey Data Total Loans Home Loans
37 of 40
CAPITAL MARKET REVIEW MONTHLY MARKET STATISTICS
Monthly Commentary l
Market extended the gaining momentum built up in the substantial gain as ICB and IDLC advanced by 11.2%
previous month. Supported by budgetary incentives, and 13.6%, respectively.
coupled with quarter end earnings expectations,
investors opted for calculative optimism and went Broad index DSEX advanced 3.6% in July, while DS30
hunting values in large and established sectors. advanced by 2.9%. The gaining momentum attracted
Impressive declarations from Telecommunication, investors from the sideline, pushing up activities
Bank and NBFI sector pumped up excitement in the significantly. Average daily turnover jumped up to
market. Resultantly, these three sectors led the market be BDT 9.5 bn, compared to only BDT 5.6 bn in the
in terms of both gain and turnover. Telecommunication previous month. During this month, all the sectors
gained 10.0% this month, as GP delivered spectacular stayed positive except for Pharmaceuticals (-1.2%) and
second quarter result. GP advanced 10.2% in the Fuel & power (-0.1%).
month of July and 37.4% during January-July, 2017
period, becoming a USD 6 bn company. As the month Meanwhile, MSCi Frontier market index advanced
progressed, impressive earnings declarations in bank
1.8% this month. Bangladesh outperformed its regional
and NBFI inspired similar reaction in the respective
peers, this month. Among the regional peers, Pakistans
sectors. Notably, RUPALIBANK advanced 53.6%
market declined by 1.2% amid turbulence in political
in July, followed by 27.8% gain DUTCHBANGL
scenario. Sri Lankan market also were on the back foot
during the same period. Heavyweight BRACBANK,
ISLAMIBANK and CITYBANK advanced by 8.8%, with a decline of 1.6%. Vietnam, meanwhile stayed flat
10.2% and 12.3%, respectively. NBFI sector also made (+0.9%).
Indices Index Point, July 2017 1M Return 3M Return YTD Return 3Y Return
Bangladesh
Peer Countries
Pakistan (KSE 100) 46,010.5 -1.2% -6.7% -3.8% 51.8%
Sri Lanka (CSE - All Share) 6,637.4 -1.6% 0.4% 6.6% -2.6%
Vietnam (VNI) 783.6 0.9% 9.2% 17.9% 31.5%
563.7 0.4% 4.9% 12.9% -18.7%
*Equity+Mutual Funds+Debt
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Top Twenty Market Cap (July, 2017)
Daily Avg. Turnover
DSE Code Sector Mcap1 (USD Mn) 1M Return 3M Return YTD Return 3Y Return
(USD Mn)
SQURPHARMA Pharmaceuticals & chemicals 2,404.4 2.0 -2.5% -0.3% 13.5% 63.5%
BATBC Food & Allied 2,246.1 0.4 6.8% 18.5% 24.6% 31.3%
RENATA Pharmaceuticals & chemicals 857.1 0.1 -1.9% 2.8% 5.0% 75.9%
UPGDCL2 Fuel & Power 819.2 0.4 -1.6% 15.4% 28.6% N/A
OLYMPIC Food & Allied 711.7 0.6 3.1% 3.6% -6.7% 107.4%
TITASGAS Fuel & Power 621.6 0.2 0.2% 1.6% 2.6% -24.4%
BXPHARMA Pharmaceuticals & chemicals 561.5 1.1 -1.2% 0.6% 38.2% 197.7%
SUMITPOWER Fuel & Power 545.3 0.6 1.0% 2.5% 11.4% 49.4%
MJLBD Fuel & Power 453.2 1.6 -0.2% 11.8% 1.3% 100.4%
MARICO Pharmaceuticals & chemicals 401.2 0.0 0.6% 2.6% 11.9% 7.6%
2
33Y return of UPGDCL is unavailable as it was listed in 2015
Top Ten Gainers List (July, 2017) Top Ten Losers List (July, 2017)
DSE Code 31-Jul-17 29-Jun-17 % Change
DSE Code 31-Jul-17 29-Jun-17 % Change
BBSCABLES 90.3 10.0* 803.0%
BDWELDING 18.3 23.7 -22.8%
JUTESPINN 97.3 60.7 60.3%
BEACHHATCH 17.7 21.9 -19.2%
SAMATALETH 46.5 29.2 59.2%
REGENTTEX 26.9 31.3 -14.1%
SINOBANGLA 66.4 42.8 55.1%
UNIONCAP 22.1 25.4 -13.0%
RUPALIBANK 42.7 27.8 53.6%
CVOPRL 236.7 263.9 -10.3%
FUWANGFOOD 24.2 15.9 52.2% BDFINANCE 19.3 21.4 -9.8%
SAVAREFR 94.7 65.2 45.2% TOSRIFA 27.6 30.5 -9.5%
DULAMIACOT 12.7 9.3 36.6% GHAIL 42.1 46.0 -8.5%
RAHIMAFOOD 184.9 140.9 31.2% PRAGATILIF* 105.2 114.4 -8.0%
IMAMBUTTON 22.3 17.0 31.2% SPCERAMICS 15.4 16.7 -7.8%
*Offer price of BBSCABLES *Represents post record date adjustment
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Top Ten Closed End Funds based on 5 years (CAGR) performance
NAV Return3
"Price1 "NAV1 "Price/ "Dividend2 Redemption
DSE Code Fund
(BDT)" (BDT)" NAV" Yield (%)" 2017 YTD 2016 2014 2012-16 Year
NLI1STMF VIPB 15.3 16.76 91.3% 9.8% 17.5% 20.0% 17.7% 15.7% 2023
SEBL1STMF VIPB 14.0 15.66 89.4% 9.6% 17.2% 19.3% 16.5% 14.2% 2021
GRAMEENS2 AIMS 16.1 20.24 79.5% 6.2% 16.9% 15.1% 13.6% 12.1% 2021
RELIANCE1 AIMS 11.3 14.42 78.4% 8.8% 13.6% 17.1% 10.7% 11.8% 2027
IFILISLMF1 ICB AMCL 9.1 10.54 86.3% 11.0% 9.8% 14.0% 12.9% 11.0% 2023
1JANATAMF RACE 7.3 12.37 59.0% 0.0% 12.8% 6.5% 12.2% 9.8% 2020
ABB1STMF RACE 7.5 13.02 57.6% 0.0% 13.6% 8.9% 9.9% 9.8% 2019
FBFIF RACE 7.0 12.47 56.1% 0.0% 11.3% 9.1% 9.3% 8.8% 2019
POPULAR1MF RACE 7.0 12.47 56.1% 0.0% 14.1% 8.2% 11.1% 8.7% 2020
PHPMF1 RACE 7.8 12.20 63.9% 0.0% 14.9% 7.4% 10.9% 8.0% 2017
2
On latest cash dividend declared
3
CAGR computed for respected periods, except for 2017, adjusted for dividend. YTD returns of funds debuting within the year represent return generated since debut, hence is not
directly comparable with return of funds that operated throughout the year.
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Road, Purana Paltan Gulshan 1, Dhaka 1212
Dhaka-1000
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